August 2011

August 31, 2011

The former acting general counsel of the U.S. Department of Health and Human Services has joined King & Spalding as counsel in the firm’s Washington office, the firm announced Wednesday.

Preeya Noronha will work in the firm’s Food and Drug Administration and life sciences practice, advising about Medicare and Medicaid regulatory issues, healthcare litigation and enforcement and fraud, abuse and reimbursement.

At HHS, Noronha provided legal advice to Secretary Michael Leavitt and oversaw more than 400 lawyers who provided legal advice to departments ranging from the National Institutes of Health to the Centers for Disease Control and Prevention. Before joining the agency, Noronha was a trial attorney in the civil division of the U.S. Department of Justice.

“Preeya’s extensive experience at HHS on matters related to CMS (Centers for Medicare & Medicaid Services) and the FDA gives our practice additional depth and increases our capacity to help clients navigate the new complexities emerging in the health care industry arising from the Accountable Care Act,” Patrick Morrisey, co-chair of the firm’s FDA and life sciences practice, said in a written statement.

A partner with a Rockville, Md., firm has been reappointed as a commissioner with the Maryland State Commission on Criminal Sentencing Policy, the firm announced on Tuesday.

Richard Finci, with Houlon, Berman, Bergman, Finci, Levenstein & Skok, will serve his third consecutive term on the commission, which makes recommendations about Maryland’s sentencing guidelines.

Finci, a criminal defense attorney who represents clients in Maryland and Washington, D.C., said in a press release he was pleased to accept the reappointment. “I will continue to work to the best of my ability to ensure that sentencing in Maryland is just and proportionate,” he said.

Formed in 1999, the 19-person commission was created to ensure fairness in criminal sentencing and to foster a public understanding of the sentencing process. The commission oversees the state’s sentencing guidelines, monitors sentencing practices, adopts changes to the guidelines and provides training for practitioners.

The Justice Department today filed suit to block the merger between AT&T Inc. and T-Mobile USA, alleging that the $39 billion transaction would substantially lessen competition for mobile wireless telecommunications services across the United States.

AT&T responded that it will “vigorously contest this matter in court,” and in a statement said it plans to ask for an expedited hearing. “We remain confident that this merger is in the best interest of consumers and our country, and the facts will prevail in court.”

The suit is a bold move for DOJ's Antitrust Division, which has been criticized in recent years for failing to stop other high-profile unions. The AT&T merger would create the nation’s largest cell phone network by combining the number two and number four companies.

“The department filed its lawsuit because we believe the combination of AT&T and T-Mobile would result in tens of millions of consumers all across the United States facing higher prices, fewer choices and lower quality products for their mobile wireless services,” said Deputy Attorney General James Cole at a press conference this morning.

Cole noted that AT&T and T-Mobile compete head-to-head in 97 of the nation’s largest 100 cellular marketing areas as well as nationwide for business and government customers. “Were the merger to proceed, there would only be three providers with 90% of the market, and competition among the remaining competitors on all dimensions—including price, quality, and innovation—would be diminished,” he said.

The case, filed in U.S. District Court for the District of Columbia, has been assigned to Judge Ellen Huvelle. Twenty-five DOJ lawyers are listed on the complaint. The suit asks that the court declare the merger violates Section 7 of the Clayton Act and that the companies be enjoined from combining.

AT&T said it was “surprised and disappointed by today’s action, particularly since we have met repeatedly with the Department of Justice and there was no indication from the DOJ that this action was being contemplated.”

AT&T this week made a last-ditch effort for approval, offering to bring 5,000 overseas customer service jobs back to the United States. The merger was supported by the Communications Workers of America, which called DOJ’s decision to block the deal “simply wrong...The DOJ’s action has put good jobs and workers’ rights at the bottom of the government’s priorities.”

The company also rallied the support of 11 state attorneys general, who sent a letter to DOJ last month urging approval of the deal, and more than 20 governors.

AT&T claimed the merger would give it the spectrum needed to develop new, high-tech networks, and would create efficiencies.

But DOJ didn’t buy it, concluding that AT&T failed to demonstrate any efficiencies “would be sufficient to outweigh the transaction’s substantial adverse impact on competition and consumers.” The government also found that “AT&T could obtain substantially the same network enhancements that it claims will come from the transaction if it simply invested in its own network without eliminating a close competitor.”

The deal was strongly opposed by consumer and media advocates, as well as competitors led by Sprint.

"This ought not to be a big surprise,” said Media Access Project Senior Vice President and Policy Director Andrew Jay Schwartzman in a statement. “This is arguably the most anti-competitive move in recent American economic history. It is heartening that the Department of Justice has withstood withering political pressure from AT&T to do the right thing for the American public.”

The merger also requires approval by the Federal Communications Commission. FCC Chairman Julius Genachowski in a statement said, “Competition is an essential component of the FCC's statutory public interest analysis, and although our process is not complete, the record before this agency also raises serious concerns about the impact of the proposed transaction on competition."

Krieg DeVault this week told Congress that a former U.S. assistant attorney general has signed on to lobby for a major traveling outdoor amusement park headquartered in Indiana.

Deborah Daniels, who led the Justice Department's Office of Justice Programs from 2001 to 2005, is representing North American Midway Entertainment, according to a lobbying disclosure. She is advocating for the Farmland, Ind.-based company with Krieg DeVault Executive Director of Government Affairs Thomas New on matters related to H-2B visas, which allow foreign nationals to hold temporary, non-agricultural jobs.

North American Midway Entertainment provides games, rides and food for fairs in 20 states and four Canadian provinces, according to the company’s Web site.

The company previously retained Krieg DeVault to lobby for it from 2005 to 2008. In its 2005 lobbying registration for the traveling outdoor amusement park, Krieg DeVault also then said it was advocating for the company on issues concerning H-2B visas.

Daniels said a Labor Department rule that will go into effect in October will increase wages for individuals who have H-2B visas and force companies that hire foreign nationals under the program to raise the salaries of their workers who are U.S. citizens. She said the wage increase is a "big problem" for companies that employ H-2B visa holders.

"They're not really sure where they're going to get the money," Daniels said.

A spokeswoman for North American Midway Entertainment didn’t immediately respond to requests for comment.

Congressional records show that Daniels lobbied this year for a few Indiana organizations, including the Indiana Orthopaedic Hospital, Ivy Tech Community College of Indiana and the Office of the Indiana Attorney General.

Daniels is a partner in the Indianapolis office of Krieg DeVault. She also served as the U.S. attorney for the Southern District of Indiana from 1988 to 1993.

Snyder, who filed
suit (PDF) against the City Paper in April in District of Columbia Superior Court, was hit with a special motion to dismiss under the anti-SLAPP law in June. He responded with claims that the law itself is in violation of the city’s Home Rule Act and the U.S. Constitution.

The city, represented by the Office of the Attorney General, emphasizes in the motion that it isn’t taking sides on the merits of the case, but that “the resolution of plaintiff’s challenge to the validity of the statute could impair the District’s ability to protect its interests.” Both sides agreed to the city's request to intervene.

The anti-SLAPP law went into effect March 31, offering a speedier path to dismissal for defendants in Washington who believe they’re being sued over protected speech. Snyder’s case represents an early test of the law’s applicability in Washington courts.

In defending against the special motion to dismiss, Snyder claimed that the Home Rule Act doesn’t give the District of Columbia Council authority to legislate changes to court procedure. The American Civil Liberties Union of the Nation’s Capital, along with a slew of media and free speech groups, filed an amicus brief in late July defending the law.

While the city, the amicus parties and City Paper have all argued on the law’s behalf, the city’s attorneys write that, “their articulated views, even if they substantially overlap with the District’s, are not the equivalent to the position of the sovereign on important public interest legislation.”

Seth Berlin of Washington’s Levine Sullivan Koch & Schulz, who is representing the City Paper, said he wasn’t surprised the city moved to intervene, “since Mr. Snyder and his lawyers have decided to try to undo a statue that protects all of the citizens of the District of Columbia.”

Snyder has accused the City Paper of publishing false and defamatory information in the November 2010 article, “The Cranky Redskins Fan’s Guide to Dan Snyder.” The paper has stood by the article and the reporter who wrote the piece, Dave McKenna. The paper, its Tampa, Fla.-based owner Creative Loafing Inc., and McKenna are all named defendants in the case.

Google Patents: Google Inc's blockbuster acquisition of Motorola Mobility Holdings Inc underscores a trend by technology companies to snap up patents in a bid to stave off competitive threats and patent-infringement lawsuits. Google's patent portfolio is seen as one of the weakest in the industry, Reuters reports.

Sweetening the Pot: AT&T Inc.,seeking government approval for its $39 billion acquisition of T-Mobile USA Inc., pledged to bring 5,000 call-center jobs back to the U.S. from other countries once the deal closes, according to Bloomberg.

Tax Avoidance: The authors of a new study said their findings suggested that current United States business policy was rewarding tax avoidance rather than innovation, The New York Times reports.

Dual Role: Assistant U.S. attorney Aloke Chakravarty has taken the lead in trying to build a better rapport with Muslims. But he also is prosecuting the terror case against Tarek Mehanna, a local Muslim whose trial is scheduled for early October. The Washington Post looks at his complicated dual role.

New Job: U.S. Army Gen. David Petraeus, who served as the top U.S. commander in Iraq and then Afghanistan, will hang up his uniform for a civilian suit today, CNN reports. He will leave the Pentagon for the halls of another hallowed Washington institution: the CIA.

In March, the SEC reached a clawback settlement with Beazer CEO Ian McCarthy for $6.5 million. The company itself settled a SEC enforcement action in 2008, and the agency charged Beazer’s former chief accounting officer Michael Rand with fraud in July 2009. That litigation is ongoing.

Clawback cases remain relatively rare for the SEC. The agency was granted the authority under Section 304 of the Sarbanes-Oxley Act of 2002, which requires some senior executives to return bonuses and stock profits they received while their companies were in “material non-compliance with financial reporting requirements due to misconduct,” according to the SEC.

“Section 304 of the Sarbanes-Oxley Act encourages senior management to take affirmative steps to prevent fraudulent accounting schemes from occurring on their watch,” said Rhea Kemble Dignam, director of the SEC’s Atlanta Regional Office in a news release. “O’Leary received substantial incentive compensation and stock sale profits while Beazer was misleading investors and fraudulently overstating its income.”

O’Leary did not admit or deny SEC allegations.

Between 2002 and 2009, the SEC brought fewer than a dozen clawback cases, and each time the executive returning the money was also charged with violating securities laws.

In 2009, however, the SEC expanded its use of Section 304 when it went after $4 million in bonuses in stock profits from the former chief executive officer of CSK Auto Corp., Maynard Jenkins, who was not alleged to be involved with any underlying misconduct. The case settled in March for an undisclosed amount.

Next month, The Supreme Court Institute and Arnold & Porter will be screening a documentary called Fast Talk, which tracks the Northwestern University debate team in its quest for its second consecutive championship.

The film will be followed by a panel discussion about competitive debate and oral advocacy.

The documentary (trailer posted below) was directed by Debra Tolchinsky, who according to the website IMDb.com worked as as assistant editor of films such as Kindergarten Cop and Searching for Bobby Fischer. She is also an associate professor of Radio-TV-Film at Northwestern University.

In addition to Tolchinsky, panelists will include U.S. Court of Appeals for the District of Columbia Judge Brett Kavanaugh; Paul Clement, partner at Bancroft; David Frederick, partner at Kellogg, Huber, Hansen, Todd, Evans & Figel; Thomas Goldstein, parter at Goldstein, Howe & Russell; and Neal Katyal, Georgetown University Law Center professor.

The embattled head of the federal alcohol, tobacco and firearms bureau, criticized for months for a firearms investigation dubbed "Fast and Furious," was reassigned today, the U.S. Justice Department announced.

Kenneth Melson, who came under fire for a bureau operation that allowed guns to travel from the United States into Mexico, was named today the senior adviser on forensic science for the department’s Office of Legal Policy.

Attorney General Eric Holder Jr. named B. Todd Jones, the U.S. attorney for Minnesota, the acting director of the Bureau of Alcohol, Tobacco, Firearms and Explosives.

In a prepared statement, Holder called Jones a veteran prosecutor and a “demonstrated leader who brings a wealth of experience to this position.” Jones will take over for Melson on Aug. 31, Holder said.

Jones was a partner with Robins, Kaplan, Miller & Ciresi from 2001 to 2009 and, earlier, a partner with Greene Espel. He served as an assistant U.S. attorney in Minnesota in the 1990s.

The Justice Department said Melson in his new role will focus on policy development in forensic science. Melson has served as the acting director of ATF since 2009.

The House of Representatives oversight committee chairman Darrell Issa (R-Calif.) and Sen. Chuck Grassley, Republican of Iowa, have led the congressional investigation of the Fast and Furious sting.

The bureau’s operation, critics contend, allowed guns into the hands of drug traffickers in Mexico. One of the firearms flagged in the sting has been linked to the murder of a federal agent.

On July 4, Melson testified before the House Oversight Committee. He told investigators, according to Grassley’s office, that agents witnessed gun transfers from straw purchaers to third parties without follow-up.

Issa and Grassley have long complained that the Justice Department has not fully cooperated in the congressional probe of the ATF gun sting. In a letter last month to Holder, Issa and Grassley said DOJ “seems to have been unable to fully grasp the magnitude and seriousness of this issue.”

This afternoon, Issa issued a statement that said in part: “While the reckless disregard for safety that took place in Operation Fast and Furious certainly merits changes within the Department of Justice, the Oversight and Government Reform Committee will continue its investigation to ensure that blame isn’t offloaded on just a few individuals for a matter that involved much higher levels of the Justice Department."

Issa said questions linger about the Fast and Furious operation and who else bears responsibility.

DOJ also said today that Dennis Burke, the U.S. attorney for Arizona, is resigning. Grassley said last month the ATF group that carried out Fast and Furious was under the direct supervision of the Arizona U.S. Attorney’s office.

Holder said in a statement that Burke supervised an office that "has made great progress in its pursuit of justice with the creation of special units focusing on civil rights enforcement and rule of law, as well as more robust outreach to key communities, particularly in Indian Country."

Several weeks after U.S. District Chief Judge Royce Lamberth issued a rebuke to to birther activist, attorney and dentist Orly Taitz over her handling of a Freedom of Information Act request for social security information, Lamberth issued an order Tuesday morning dismissing the case.

Taitz, who lists a California address, sued the Social Security Administration in U.S. District Court for the District of Columbia seeking information on the living holder of a particular social security number. Taitz, in this case and others like it filed in courts across the country, has been attempting to prove that President Barack Obama is not a natural born U.S. citizen and is ineligible for office.

“As her numerous filings with the Court demonstrate, plaintiff will stop at nothing to get to the bottom of this alleged conspiracy,” Lamberth wrote in his
opinion (PDF) dismissing the case. “Unfortunately for plaintiff, today is not her lucky day.”

The Social Security Administration had turned over some social security information Taitz had requested for several deceased individuals, but had refused to do the same for individuals who are still alive, citing the statutes that keep social security information private.

Lamberth, in granting the agency summary judgment, found that Taitz had failed to produce any evidence that the social security information was being used improperly by a public official – the president, in this case – and prove a “legitimate public interest” in disclosing the requested information.

Taitz, in an e-mail Tuesday morning, said she is reviewing the decision but expects to file a motion for reconsideration. Citing other lawsuits pending against White House Counsel Kathy Ruemmler and other officials, Taitz said she will continue to pursue “legal actions… for their part in aiding and abetting Obama” in producing “forged documents.”

A Social Security Administration representative did not immediately return a request for comment.